This is a question we get a lot, so we thought it best to publish a very brief article clarifying the situation for all those who need to know.
The situation is this: You have found a new home which you want to make an offer on, all of your finances are in-line, you’re ready and raring to go. But then the estate agent tells you that they won’t inform the vendor of your offer because they have already accepted a different offer earlier in the day. Effectively, they’re saying they’re not interested in your offer.
Is this allowed, or is the agent legally obliged to inform the seller of any offers that come in?
The Legal Obligations of Estate Agents
Agents are legally obliged to inform the seller of your offer within 24-hours of receiving it. This clause will be included in the small print of the contract signed between the agent and the seller.
The only exception is if the seller has instructed the agent not to inform them of any offers below a certain price.
So, in the specific example of an agent refusing to forward an offer because another offer has already been accepted, it’s more than likely that they are breaking the rules.
However, things are never that simple. It might be that the seller has instructed the agent to ignore all offers that come in below that which they have already accepted. If this is the case, the agent should tell you so, thus giving you the chance to increase your offer. The agent probably won’t disclose the precise amount of the existing offer, but can offer hints.
Because of the small print we mentioned before, unless the agent informs you the offer is too low, you can insist that they pass it to the seller, otherwise they’ll be in breach of contract.
Why Would An Agent Refuse To Forward An Offer?
It’s reasonable to question why an agent would refuse to forward your offer, especially if it means the property might sell for a higher price, thus giving them a higher commission. So why would they refuse?
It’s possible they’re making a judgment about what sort of buyer you are compared to your competition. They might consider the other person to be a more reliable buyer, perhaps more financially prepared meaning that the sale will happen faster. They could be worried that your last-minute offer will cause a delay in proceedings.
But it’s not their choice to make – it’s up to the vendor.
If you want to make a complaint about an estate agent who is refusing to submit your offer to the vendor, we have a full guide for you, here.
If you have any additional questions, our in-house property expert, Russell Quirk, is happy to help. Just drop us a message in the comments section below, and he’ll get right back to you.